1. If an ARM has a margin of 2.5 and the start rate is 4% and caps of 2/2/5 and the index at the first adjustment is 5, what is the rate? A. 6% B. 7.5% C. 9% D. 6.5%
2. One way to avoid foreclosure and the negativity it can create on ones personal credit or a companys business but not retain ownership is

3. A. Bankruptcy B. A modification/renegotiation C. A deed in lieu of foreclosure D. loan origination market

1. The acceleration clause increases risk for the lender.

True/False

2. A 10/1 mortgage has a variable rate for the first 10 years and then the rate is fixed for the remainder of the term of the loan.

True/False

3. The mortgage serves as a security for the promissory note.

True/False